Activision has signaled that Guitar Hero will soon be rocking Xbox consoles around the world after sales of over 1 million copies on PS2.

Mike Griffith, President and CEO of Activision Publishing, was asked about the possibility on Guitar Hero on Xbox at the recent Activate conference.

"Our strong philosophy and strategy is that we develop games across multiple platforms and we believe that the consumer really drives the choice of what platforms to enjoy our games on," says Mr Griffith. "So I think it would be a fair assumption to say that all of our core games will be offered across all popular platforms."

Considering Activision paid over $100 million to acquire Guitar Hero publisher Red Octane, it's a fair bet that the company considers the guitar-strumming smash one its "core" titles.

At Activate, Screen Play also spoke to Charles Huang, Chief Operating Officer and co-founder of Red Octane, about the success of Guitar Hero and why its sequel is going to rock even harder. Check out the full interview below:

Why do you think Guitar Hero has been so successful?

Wow. Well, if you take any of the individual elements of Guitar Hero, they are all very simple: the interface, the gameplay, even the controller. Even though it's a new controller, there's nothing super difficult about it. This is not like technology from 10 years from now, it's pretty straightforward. But it comes together so nicely. One of the things we go back to is the authenticity of the experience, that's what people really enjoy. It feels like you're playing a song. It feels like you're holding a guitar. We wanted to capture the essence of all of that, we wanted to capture the essence of rock and metal, and give the users as authentic an experience as possible. And it didn't feel gimmicky or embarrassing, it really made people feel like they were playing that song. We didn't go after the deepest storyline, the most complex or realistic or whatever, we just went after what we thought would be authentic and fun. A high fun factor is what we were after.

How did the project come about?

We had met Harmonix many years ago when they were working on a couple of games called Frequency and Amplitude. Sony published those and at that time we were primarily a peripheral manufacturer. They talked to us and Sony talked to us about building a peripheral for Frequency and Amplitude. We kicked ideas around but nothing really came through. A couple of years later we ran into the CEO of Harmonix again and said we should do a game together. We'd been thinking about a guitar game for years because we thought music games were successful in Japan, and if you were ever going to make a game that was representative of popular music in the US, for us it would have to be guitar that was the instrument. So we said: "We want to do a guitar game" and they said, "That's funny, we want to do a guitar game!" It actually came together incredibly quickly. From the time we first discussed it to the time it was released, it was a total of about nine months. Everything just seemed to fit so well. We had to design the controller from the ground up while they did the software, but everything came together very quickly. It was just one of those magical moments in time where everyone's ideas seemed to be on the same path.

Why do you think it took a small publisher like Red Octane to break through with a massive hit like Guitar Hero when Harmonix had worked with major partners like Sony in the past?

The Harmonix music games have been very successful and published by companies like Sony and Konami, they certainly are big publishers. But I think at the beginning of the project there was a lot of inherent risk. People had told us that Americans don't buy peripheral-based games, they don't buy music games, the price is too high for something this late in the cycle of PS2, the box is too big to fit in retail. There was a lot of reasons why people were skeptical. Red Octane as a company had always been doing unconventional things and we had believed for many years that a music game like Guitar Hero that was focused on rock and metal would work. When you say why did it take a small publisher, well one of the things that allowed us to see beyond a lot of the barriers was that we were blessed with being ignorant about the game industry. We didn't realise all these things that people said couldn't be done, we just thought, that's what we believe in, we can do it. Sometimes ignorance works to your advantage.

Explain the reasoning behind the Activision acquisition, it seemed strange timing for Red Octane, just as you had a big hit and financial freedom that you could leverage to go and do anything you liked.

That had always been our goal. The Activision thing came together very quickly. If you look at the US and Europe, there are very few publishers doing what we did, building hardware as well as software. No-one outside of the Japanese build hardware for their games. And we focused on a genre that almost nobody else focused on - music games. So we thought we had a niche that we were going to do well in because it was largely overlooked. One of the things that happened with Activision was that Guitar Hero became a much bigger success than any of us imagined. It took us from being a relatively unknown company to suddenly being very high profile, competing with major titles. Being a small company with small resources, there were a lot of things we realised we couldn't do. In order to take a franchise like Guitar Hero and bring it to a global scale, do all the things that we envisioned over five years, we realised that we had to do them very quickly now because if became a big hit right off the bat. We knew everybody else would start to look at this space once Guitar Hero hit and so we realised we needed to join up with Activision to build up Guitar Hero.

What do you think about the state of the games business? Is there still a place for independent developers and for small publishers?

I definitely believe so. We came from a group of people that didn't know anything about publishing, yet we still published video games. People talk about how big EA or Activision is but when you compare it to other software industries, whether it be operating systems or databases or whatever, there's a lower market concentration. So when people blame the lack of innovation on the fact that big companies are dominant, I still think there's a lot more opportunity than people realise, especially when you look at other software industries and compare them. I see a lot of companies and developers doing very innovative work and I think that there's money coming into the industry to fund games that will be different than what we've currently got. It's a challenge with next-gen and bigger budgets but Guitar Hero has proved that you didn't need $20 million budgets, you didn't need the latest and greatest graphics and game engines to succeed. What you needed was original ideas and the conviction to take those ideas and bring them to marketplace. There'll always be room for small publishers and developers in this business and I don't think the industry is in such a dire position as some believe. Looking at where we've come from in just three years, if we can do it, then others certainly can too.

Are there plans for other instruments? Drums, for example?

We look at the music game genre from a variety of different viewpoints. One is the instrument based view - drums, keyboards, there's a whole line of instruments you could do. But we also look at it from genres of music. Guitar Hero was about guitar, but also capturing the essence of rock and metal. We look at other genres of music and think how do you capture the essence of say hip hop, or country, or electronica. We might also look at how people like to access their music. Portable music is a huge phenomena, iPods have been very successful, and the way that users interact with music in a portable device is different to in your living room with two big speakers. We look at how we can capture that and bring music to people in portable environments. And can we do anything in online multiplayer, even massively multiplayer? So we're looking at how we can do more games with different instrument-based products, but we're also looking at a lot of other areas as well.

So why is Guitar Hero 2 going to rock?

The three things we're bringing are: more, more and more. More guitar, more songs and more modes. For Guitar Hero 2, you'll be able to play both lead and bass or rhythm. Two people can now play co-operatively: one of you can play bass, the other can play lead. For each song now you can actually learn two different tracks. So there's a lot more guitars. There's more songs, we're hoping to finish with about 50 licensed songs. We've been able to get a lot of great bands. The first time around it was just a concept, and we'd talk to artists and a lot of them didn't get it. How do you play a video game with a guitar? But this time around we're able to show them and they've seen the success so it's much easier.

And they will still be cover versions?

We're actually getting some masters. We've got one we've already announced which is John the Fisherman, Primus has given us the master track and we're working on a couple of other master tracks as well. So we're definitely trying to get more original performances. The third thing is more modes. We've added a more robust tutorial mode. We wanted to make it more accessible for beginners to ramp up to the harder difficulty levels and at the same time we've added an expert level and kicked up the difficulty for them. So the challenge is to help people improve in the tutorial mode, and you'll be able to do things like select certain sections of songs to practice. If you're failing the same section five minutes into a song you don't have to play through the whole thing. You can also now slow down the music and the note chart as they come at you. There's different speed settings you can choose in tutorial mode. We think these things will make the game more accessible to beginners and we're also going to kick up the difficulty a notch for the experts. So there's a lot more that we're bringing to Guitar Hero 2.

The Office of Film and Literature classification has awarded Rockstar's controversial Bully an M rating.

The OFLC advisory for the game says it has "Moderate themes, violence and sexual references". While consumers of any age can purchase an M-rated game, they are not recommended for children under 15 years.

Many anti-bullying groups around the world have spoken out against the game, with the most recent protest outside Take Two's New York offices captured on this YouTube video.

"We think it's very irresponsible for someone to put a game out like this," says a protester in the video.

"If you're coming from where I come from in (Washington) DC, where children get killed in schools and everything, and see people get picked up off the ground with their brains in the street, then you know we're not exploiting."

"We're dealing with real issues, where our children are trained to be animals. Anybody who would do that is just as bad as the terrorists overseas."

The New York Times recently published a preview of Bully, which will be released on PS2 in October from the makers of Grand Theft Auto, describing it as "whimsical". The article said concerns from anti-game activists had "been significantly overblown".

With reports of Dead Rising turning Xbox 360 consoles into zombies and allegations of a high failure rate for Microsoft's machine, Screen Play wants to hear your hardware horror stories.

Have you had any problems with your Xbox 360? Do you think game consoles are reliable? What has been your experience of customer support when you have tried to get a console repaired?

Game consoles used to have a great reputation for reliability (particularly Nintendo machines) but the introduction of CD-based consoles saw a spike in problems.

Many PSone owners had to operate their machines upside down or on their sides (which could have given Sony the idea for the vertical PS2 design) while the words "this disc is either dirty or damaged" will send a shiver up the spine of any Xbox owner.

The reputation of console manufacturers took a big hit last year with two high-profile product recalls.

Microsoft was forced to recall 14 million Xbox power cords after reports of gamers burning their hands and consoles causing damage to carpets and entertainment units, while Sony also issued a recall of over 3 million slimline PS2 power adapters after reports of overheating and melting.

Recently, Nintendo pledged they would offer free repairs for any faulty DS Lite consoles after complaints of cracked plastic hinges.

Codemasters promise the original game's devilish sense of humour will be retained for the PSP sequel, which will be released next year.

Players can command soldiers individually or as a group, and new features will include air strikes, flamethrowers and sniper rifles. The game will also support four-player deathmatch action and co-operative play.

A boutique conjures the image of exclusive, high-quality luxury goods peddled by attentive staff, but EB stores are more like ramshackle pawn shops.

It's a shame the high-profile outlets, which are found in almost all major shopping centres around the country, seem so intimidating and shambolic. If the Australian games industry wants to continue its growth and capture new audiences, it is going to need retail partners to help.

Screen Play often wonders who the average EB customer is. Hardcore gamers would naturally be attracted to the generous 7-day return policy, which is like a free rental system if abused.

But surely few gamers would be happy to pay EB's prices (especially for what could be a second-hand product) or consider EB's terribly limited range of stock to be acceptable.

More casual consumers are also likely to find the stores equally off-putting because of their chaotic layouts, ugly aesthetics and high prices. And of course, they'll have little-to-no chance if they want to actually try a game before they buy.

It's also baffling that anyone would take up EB's trade-in offers. Posters plastered all over EB stores at present proclaim customers can get $300 off a next-generation console, but the fine print says you must part with a PS2 or Xbox and a whopping 25 games.

Whether you're trying to buy or sell second-hand, Screen Play suspects anyone will do an awful lot better on eBay. The mark-up of second hand goods at EB seems to be five to 10 times what they offer desperate trade-in customers. No wonder the stores devote so much shelf space to second-hand product (to the chagrin of game publishers).

Screen Play's ultimate game store would have lots of opportunities for hands-on play, a wide range of new and back-catalogue titles (rather than simply 100 copies of the latest over-hyped "blockbuster") and knowledgeable, fanatical staff.

Like the best record and book shops (which are sadly now almost as rare as good game stores) Screen Play's gaming oasis would be a place where passionate types could hang out, sample exotic new titles and swap recommendations. Second-hand games would be left to online traders or garage sales where they belong.

Game1 will be run in conjunction with the popular Auto Salon show, which attracts over 70,000 attendees, and is also coming to Sydney on December 2 and 3 at the Sydney Showground Olympic Park.

Game1 organisers say exhibitors will show the latest hardware and software releases and host Australia's biggest live gaming tournament.

Nintendo has confirmed it will be exhibiting at both exhibitions, with attendees able to get hands-on with the radical Wii console.

Microsoft will also be showing the latest Xbox 360 titles at both shows, but Sony is still undecided whether it will attend.

A new games expo is also being organised in Perth. The GO3 Electronic Entertainment Expo 2007 will be held at the Perth Convention Exhibition Centre from March 30 to April 1 and include a consumer expo, developer conference and LAN party.

I've been called a Nintendo fan-boy, a Microsoftie and a PlayStation whore during the last 15 years chronicling the rise and rise of interactive entertainment. The autonomous journo inside Screen Play is always hurt by such accusations, but in retrospect, the labels were right.

Today, Screen Play comes clean: I want to see all three next-generation consoles succeed.

A successful Nintendo lets us delight in the genius of Shigeru Miyamoto and encourages an overly conservative industry to embrace innovation and concentrate on entertainment rather than technology.

A successful Sony gives us wonderfully inclusive family fun like EyeToy, SingStar and Buzz,
and more games like Gran Turismo, Ico and Shadow of the Colossus.

And a successful Microsoft gives us a fantastic online gaming system, more Halo, and keeps Sony on its toes.

But I promised bold predictions to conclude a fun week of Battle stations, so here goes...

Screen Play expects Nintendo to take the early lead in the next-generation console battle, with Wii's low price and irresistible new experiences attracting both gamers and new consumers who have never purchased a console before. Sales of 20 to 30 million consoles in just two or three years are feasible.

But Wii's momentum will soon slow as the novelty of the unique controller wears off. Consumers will also start to bemoan the gulf in graphical performance between Wii and its competitors as the price of PlayStation 3 and Xbox 360 fall.

Screen Play also expects Microsoft to race to sales of 20 million 360 consoles, roughly the same number they sold of the original Xbox, with Halo 3 finally converting most remaining stragglers to upgrade.

However, while Microsoft keep insisting that games like Kameo, Gears of War, Halo 3 and a few 20-year-old arcade games will grow their market share, they will not convert new consumers to the Xbox platform in any significant numbers.

PlayStation 3's fortunes are the most difficult to predict. It will undoubtedly enjoy a successful launch despite the high price tag, because hardcore gamers will pay anything for the latest and greatest. There are certainly plenty of Screen Play readers who are already in line.

However, sales will only really get going once the machine's price is halved and Sony has all of its big-name game franchises (and necessary new delights) on store shelves.

Screen Play expects Sony to eventually regain market leadership because of their marketing muscle, brand strength, track record on diverse software, and holistic focus on all forms of digital entertainment.

But it will take several years for Sony to regain top dog status, and PS3 will never dominate like PS2 has in the current generation. In five years time, Screen Play predicts Sony will have enjoyed sales of 50 million PS3s.

So there you have it, flame away, but please keep it clean. And feel free to bookmark this page and return in five years time to have a giggle at my expense. (Although Screen Play reserves the right to change predictions when we actually own all three consoles, or maybe even as soon as next month's visit to the Tokyo Game Show.)

By the way, if you add the totals, you might notice Screen Play expects the home console market to actually shrink compared to the current generation. That's because I suspect the booming popularity of handhelds will erode TV-based console sales, and because the PS2 juggernaut will continue for many years.

It's not just a games console under your TV, it's a Trojan Horse. Any day now, Bill Gates or Ken Kutaragi could leap out of the box and take over your lounge room.

The games industry is a lucrative business, but both Sony and Microsoft are using the popularity of interactive games for even bigger stakes. With their sights set well beyond the joypad, Sony and Microsoft want control over all the digital entertainment you consume.

Playing movie DVDs and music CDs was just the start: the PlayStation 3 and Xbox 360 offer features like downloading games, videos and music, chatting to faraway mates while showing them holiday snaps or sharing digital music, and watching TV-style broadcasts.

Sony has always refused to call PlayStation a games console, but now PS3 and Xbox 360 are true convergence devices.

Many consumers are expected to buy PS3 because of its Blu-ray high-definition movie playing capabilities alone, while broadband Internet connections let the console manufacturers pipe all manner of digital content straight to consumers, by-passing traditional retail distribution and broadcasting channels (and enabling the monitoring of everything you play, watch and listen to).

Even Nintendo, which used to have a strict games-only mantra, has finally embraced the world of multimedia. Wii will let users play DVD movies, access an online service for downloading classic games, battle faraway online rivals and visit Web sites.

The aesthetics of the new consoles have also matured in keeping with their new place at the centre of home entertainment: each of the three next-generation systems can be operated horizontally or vertically and has a futuristic case befitting modern audio-visual equipment.

But Sony and Microsoft have different visions of the role played by their consoles in the home. Whereas Microsoft position Xbox 360 as an "entertainment amplifier" that can take advantage of digital content on your Windows PC, Sony want PS3 to be the home's main entertainment hub.

As Microsoft's proposed Live Anywhere system illustrates, Bill's behemoth is using games to help continue its dominance of the desktop PC market and extend its reach to handheld computers and smartphones. Microsoft is in the games business because they want to ensure consumers use their software on every possible platform.

Sony dream of a PlayStation under every television set, with consumers downloading the latest Sony Music track, watching the latest Sony Pictures flick or playing the latest Sony Computer Entertainment game. Sony also wants to see the PS3's Cell processor integrated into other smart household devices, and expects PlayStation 4 will not use physical discs at all, only downloads.

Of course, dominating the lounge room is not going to be easy. Sony has already discovered with its failed hybrid PSX that consumer expectations in the world of convergence are high. Users demand fully-featured products that make no compromises.

With Nintendo now firmly targeting consumers who have never played interactive games before, the agendas of the three console manufacturers have become so radically different that some might consider they are actually not competing at all.

The good news for everyone is that the next-generation consoles offer a lot of functionality for the price. Consoles are typically sold at a loss, with the hardware manufacturers recouping their costs through software sales.

But some might be concerned that the eventual market leader in the next generation will be in a powerful position to control what tens of millions of consumers around the world play, watch and listen to.

Tomorrow: And the winner is... Screen Play predicts the outcome of the next-generation battle.

Tall poppy syndrome obviously isn't unique to Australia. Ever since Sony revealed PlayStation 3's price at this year's Electronic Entertainment Expo, cynics around the world have pronounced it is "Game Over" for Sony's domination of the home console market.

It's a bold prediction for countless reasons, but particularly because Sony has managed to sell over 200 million PlayStation-branded consoles in the last decade, often against the odds.

Sony was initially given no chance of beating Nintendo and Sega at their own game, and has since dominated two console generations, including beating Microsoft into a pulp in round one of what is certainly to be a lengthy bout.

Yes, the price tag for PS3 of $829 or $999 for the (recommended) premium bundle is an unprecedented high price for a games console. While it can be argued that the price represents good value for the cost of the individual components and the machine's PC-like functionality, Sony must expect that its rivals will enjoy a big early lead in the next-generation battle because the PS3's initial price is beyond many consumers.

However, like its predecessors, PS3's price will fall over time, and its installed base will
rise accordingly.

Sony has been instrumental in the growth of the video game industry. Using astute marketing and relevant games, Sony has helped make gaming "cool" and attracted millions of new players, opening up the young adult market which was virtually untapped a decade ago.

Many critics forget that PlayStation 2 was launched locally in November 2000 for a whopping $749. Sales were initially slow, but PS2 slowly built momentum and eventually commanded a 75 per cent market share against the technologically superior Xbox and GameCube in Australia and Europe. Of course Sega, market leader a decade ago, now no longer even makes consoles after being muscled out.

Six years later, PS2 is still selling in huge numbers, and big-name exclusives like Yakuza, Final Fantasy XII, Okami, God of War and Guitar Hero II are yet to come. Sony's brand equity and track record in keeping its consumers happy will prove invaluable when consumers shop for a next-gen console.

Sony sold over 100 million PS2s around the world because it satisfied hardcore gamers while providing innovative new experiences to widen console gaming's reach far beyond the traditional adolescent male audience.

Sony's record of software innovation from its internal studios is impressive, with titles like SingStar, EyeToy, Buzz and Gran Turismo attracting millions of new console owners. And third-parties naturally followed suit - there is a reason why Guitar Hero is a PS2 game and not (yet) on Xbox.

History tells us that to dismiss Sony is a serious mistake. It's also strange given there is almost widespread agreement among game developers and industry analysts that PlayStation 3 is the most powerful and flexible of the three next-generation consoles.

Due in Australia on November 17, PlayStation 3 offers astonishing computing power and formidable multimedia capabilities.

Sony will build on the success of its big-name franchises, but has also wisely shown a commitment to introducing new games for the upcoming console. Sony's PS3 version of the popular SingStar karaoke game shows the company is still acutely aware of digital entertainment trends, with online MySpace-style pages where users can upload videos of their performances.

But Sony must remain mindful that it needs to continue to innovate to attract new players,
reinvigorate aging franchises and keep hardcore fans keen. Too many gamers see Sony as arrogant and smug: a perception it must humbly address.

Sony's third-party developer support remains the envy of its competitors, including system-sellers like Metal Gear Solid and Grand Theft Auto, and PS3 also enjoys the best support from gaming behemoth Electronic Arts. Developers always want to make games for the most powerful systems available to let their imaginations run free.

PS3 purchasers would have confidence that they are buying a system which will enjoy a wide range of titles to suit every taste, even if most games made for both 360 and PS3 will be identical.

The PS3 controller has been lambasted for mimicking Nintendo's Wii, but adding tilt-sensing capabilities to a refined, wireless version of its supremely comfortable and popular joypad was a pragmatic decision.

Developers can take advantage of (albeit more basic than Wii) motion-sensing capabilities when appropriate to add to the game experience, but stick to traditional joypad controls when it would be an unwelcome gimmick. And for the full wave-your-arms-like-you-just-don't-care experience, a higher resolution PS3 EyeToy camera will no doubt offer greater precision than the primitive (yet still entertaining) original.

The omission of rumble support from the (now rather inappropriately named) Dual Shock controller is disappointing, and seems to have a lot more to do with legal issues than technological reasons. It is a situation that should be addressed - games like Gran Turismo feel strangely sterile without the rumble feedback.

Sony has shown an admirable commitment to backward compatibility that preserves consumers investment in PSone and PS2 software and encourages loyalty to the brand. Microsoft's half-baked software solution backfired, but stable hardware-based backward compatibility to reliably play the hundreds of millions of PSone and PS2 titles sold around the world is good PR, even if it is not a console selling point.

So, given PS3's price will eventually fall, Sony software should offer wide appeal and third-party support is very strong - why wouldn't PS3 succeed?

Online could be one major reason. The PS2 network was a debacle, despite Sony's insistence that more people played PS2 online than Xbox. And in the next generation, online support will be a lot more important, as 360's Live penetration clearly illustrates.

Consumers might like the sound of a free PS3 online network, but letting third-parties run (and potentially charge for) their own online gaming services while still trying to offer the benefits of a unified Xbox Live-style system (one identity, one friends list, chat, player rankings, etc) will be extremely difficult to implement and potentially confusing.

Screen Play has always thought Sony should just swallow its pride and mimic Xbox Live. It appears that many of Live's best features will be aped, but whether Sony can produce a system that is as easy to use and reliable as Microsoft's remains to be seen.

Another cause of trouble might be that PS3's price doesn't fall quickly enough, giving its opposition unstoppable momentum. Third-party developers want to sell to the biggest possible audience, so big-name exclusives are likely to dry up if 360 and Wii get a big early lead. Already Sony has to share Grand Theft Auto IV with Microsoft - it won't want to rely on its internal studios alone for all of its exclusives.

PS3's range of launch titles will not be enough to tempt many gamers to part with such a significant wad of cash, despite alluring titles like Call of Duty 3, SingStar, Heavenly Sword, Splinter Cell Double Agent and the promise of MotorStorm and Warhawk. It will require the release of many giants like Grand Theft Auto IV, Assassins Creed, Resident Evil 5, Final Fantasy XIII, Gran Turismo and Metal Gear Solid 4 before significant PS3 sales are garnered.

While it gets the headlines, the benefits of the Blu-ray disc format are uncertain. It could be a major selling point for PS3 if enough consumers want a high-definition movie player. Most standalone Blu-ray disc players are likely to cost around $1000, so PS3 gives you a great games machine as a bonus.

But it is difficult to imagine most consumers are dissatisfied with the quality of DVD or willing to upgrade their movie collection, even if they've just spent thousands on a new plasma or LCD.

The bottom line is that Blu-ray is significantly adding to the cost of the machine (and possibly also to the price of games) so if the only benefit to gamers is that titles don't have to be shipped on multiple discs, its value is questionable.

If the PS3 does have the computing muscle to shift games at a progressive scan 1920 x 1080 resolution as Sony claims, the results will be incredible, although certainly not as striking as the initial jump from standard definition to 720p output.

But the problem for Sony is that most initial titles will not support 1080p and most HD panels currently sold in Australia don't offer it either.

And finally, there is also a question mark over how difficult the PS3 is as a development platform. Many developers suggest that the machine's complexity will ensure PS3's full power is not utilised for many years. This might be a problem for Sony when trying to convince shoppers to pay a premium for PS3 over 360, even if Sony's track record on software is superior.

As difficult as it is to imagine many consumers shelling out $1000 for a games console, it is also difficult to imagine PS3 not commanding a sizeable audience as it becomes more affordable. PS3 is powerful hardware that will undoubtedly be backed by compelling, highly desirable new software.

How big will PS3's market share be? Screen Play will leave its bold predictions for our final Battle Stations installment on Friday.

Tomorrow: Playing for keeps - Screen Play looks at the wider battle to control how consumers access all their digital entertainment.

You say you want a revolution? Well, Nintendo is certainly giving you one.

The Nintendo Wii's radical and innovative controller befits the console's Revolution codename and sales success could turn the games industry on its head.

The controller, which resembles a TV remote and uses a sensor to track movement, represented a massive gamble for a company which had been relegated to third place in the home console market. But the bet already appears to have paid dividends in restoring the company's status as the games industry's leading pioneer.

You have to admire the company's bravado and commitment to innovation - Nintendo has bigger coconuts than Donkey Kong. With every other major company in the video game business almost exclusively chasing realism and ever-increasing complexity, Nintendo bucked the trend and embraced simplicity.

Sony's EyeToy proved there is a big market for alternate control systems. Many consumers are intimidated by the modern joypad and Wii has the potential to attract players of all ages that have never owned a game console before.

At E3, Screen Play sampled titles that felt both effortlessly intuitive (Wii Sports) and unnervingly novel (Zelda Twilight Princess, Super Mario Galaxy). Both are great signs for Wii, as the machine could simultaneously embrace newcomers with its natural control and provide a fresh experience for the jaded hardcore.

Of course, the biggest question hanging over Wii has yet to answered. Brief play sessions at E3 could not possibly determine whether the control system will be able to offer necessarily depth beyond its irresistible gimmick appeal.

Modern controllers allow games with astonishing depth and complexity, but many gamers fear that playing with the Wii-motes will become repetitive, and worse still, tiring. Sony copped criticism for its motion-sensing PlayStation 3 controller, but it could offer a more pragmatic solution - Wii risks throwing the baby out with the bathwater.

There are many other practical concerns: Will the Wii controllers work in all conditions? Will consumers mind having to install a sensor on their television? How can you play frantic four-player Wii Tennis matches in the average cramped living room? We probably won't know all the answers until launch, expected to be October or November.

Of course GameCube controllers can be used with Wii, and Nintendo has also shown prototypes of other more familiar controller designs. But third-party developers in particular will be reticent to develop games for anything other than the standard Wii-motes. Gamers are notorious for not purchasing add-on peripherals in large numbers, and increasingly conservative games publishers do not like limiting their potential audience.

As Screen Play has explored before, third-party game support remains a huge challenge for Nintendo.

Nintendo 64 and GameCube both suffered from a lack of compelling third-party titles compared to rival platforms, and hardware sales suffered accordingly, leading to the premature demise of both machines.

Support for Wii is very limited at this stage compared to Xbox 360 and PlayStation 3, despite some recent gains. While Nintendo has wisely tried to tackle the escalating cost of game development to make Wii a more attractive prospect for third-party developers, it ironically still represents a much bigger risk.

Publishers can spread their risk by easily releasing titles across PC, PlayStation 3 and Xbox 360 platforms, but Wii requires specialist teams because of its unique controllers and significantly lower specifications.

Early in Wii's lifespan it will also be extremely difficult for third-parties to compete with Nintendo's in-house development teams, which have enjoyed more time to come to grips with the unique possibilities of the Wii controller.

The Wii's huge price advantage over Xbox 360 and PlayStation 3 will undoubtedly see the machine very quickly take an early lead in the next-generation console battle. In Australia, Screen Play is expecting a $329 or $349 price point, whereas the recommended Xbox 360 bundle costs $649 and the superior PlayStation 3 bundle will cost $999.

Gaming connoisseurs would be crazy to miss the chance to buy such an inexpensive system that will serve up Nintendo's best franchises in new and exciting new packages.

Nintendo still produces some of the world's finest video games, and every system they have ever produced has been great value if only to play a handful of the company's best titles.

Hardcore gamers will also delight in being able to download classic games from the last 20 years via the Wii's "virtual console" functionality, although the pricing of such a service will ultimately prove crucial in determining its success and value.

There will also undoubtedly be new consumers attracted to the affordable machine because of its innovative controls, mirroring how Nintendo has widened the market for handhelds with DS titles like Brain Training and Nintendogs. The DS success against the more powerful PSP has made Nintendo extremely bullish about Wii's prospects.

But Nintendo must not forget how many consumers buy consoles so they can play the likes of traditional sports games (Madden, FIFA, Pro Evolution Soccer), car racing simulations (V8 Supercars, Gran Turismo, Forza, Need for Speed), and most importantly, adult "sandbox" games (Grand Theft Auto).

Nintendo must work very hard to convince third party developers to bring a wide range of games to Wii, not just titles for kids or games which obviously lend themselves to freestyle control.

What is unknown is how much of a disadvantage is Wii's lower graphical grunt compared to its high-definition competitors. As more and more consumers upgrade to HD plasma and LCD screens, will they be satisfied by Wii's output?

Unless Wii has a wide range of titles like PS2 has enjoyed this generation, it is difficult to imagine its early sales lead will not be gobbled up once 360 and PS3's hefty price tags inevitably fall.

Nintendo also needs very careful marketing to support Wii. Screen Play loved the initial teaser video, which showed the infectiously appealing experience of playing Wii rather than any of the games themselves, and would like to see a similar launch campaign.

Once you see Wii it action it is difficult to resist having a try yourself, but Wii will be very difficult to demonstrate at retail. Nintendo also has to do a lot of work to shake of its (somewhat unfair) "kiddie" stigma and prove the Wii is a system that can entertain gamers of all tastes and ages.

Nintendo has been a constant innovator in the games industry, pioneering advances like the D-pad, analog control, shoulder buttons, rumble technology and creating many of the finest video games ever. Wii could be Nintendo's finest hour, providing a new level of immersion to the gaming experience.

The initial pessimism surrounding the Revolution concept by a fickle and conservative market has been replaced with almost unbridled enthusiasm, and Wii is certainly going to be a bold and fascinating journey into the unknown.

Let's hope Wii a smashing success, as it will undoubtedly encourage further innovation and creativity in the interactive entertainment industry. But for Nintendo to wrestle market leadership from Sony in the next generation, there are still significant challenges ahead.

As the first next-generation console on the block, Xbox 360 is undoubtedly reaping the benefits.

Microsoft has already sold over five million consoles, and has significant momentum as its competitors prepare to join the fray.

With titles like Project Gotham Racing 3, Oblivion, Ghost Recon, Call of Duty 2, Saint's Row and Dead Rising, plus Gears of War and Halo 3 on their way, Xbox 360 is well-positioned this Christmas as a hugely desirable boy's toy.

Microsoft has garnered the praise and devotion of many dedicated joypad jockeys, although it has lost some of the early goodwill due to the recent dearth of quality software and its backward compatiblity tardiness.

What Microsoft is yet to prove is that Xbox can attract the kind of broad demographic that Sony garnered over 10 years of PlayStation, and that Nintendo looks likely to regain with Wii.

Microsoft was determined to learn from their experience with the original Xbox and not be late for the next-generation party. It has also ensured it will not suffer the massive losses on hardware that proved insurmountable to recoup in the last generation.

Xbox 360 is a terrific machine. Its standout feature is the Xbox Live online service which allows players to easily enjoy multiplayer action with friends or strangers and download content like games, music and videos.

The machine has plenty of grunt under the hood, and it is doubtful that consumers will notice PlayStation 3's technological superiority, particularly in the first year or two.

The machine also offers flexible multimedia capabilities, such as playing DVD movies, ripping music CDs, streaming music and video from portable devices or Windows PCs, viewing photo slideshows and chatting to faraway friends.

Given the machine's quality and solid third-party software support, there seems little
doubt that Microsoft will convince the majority of Xbox owners to upgrade to 360, which should ensure they sell over 20 million consoles around the world.

But even with a significant head start, quality hardware and pioneering online service, Microsoft is certainly not guaranteed to increase its market share. Software holds the key.

Microsoft's internal studios need to lead the way and help expand 360's audience beyond its current narrow focus of young men.

Microsoft must learn from PlayStation 2, which dominated the current generation of consoles (despite its technological inferiority) because it offered games for every demographic.

Arcade titles might be enjoyed by all family members once a 360 is introduced into the home, but Arcade obviously has no retail presence so will not help sell many consoles. Punters looking at the shelves at their local game store are simply going to see a whole swag of boy's own adventures for 360.

Arcade is also likely to offer little advantage once Wii and PS3 have their own similar networks established.

The proposed Live Anywhere system is intriguing, and represents a real point of difference for the 360. Microsoft's domination of the PC market and its increasing share of the mobile phone and handheld PC markets ensures no other company could offer such seamless integration between platforms. But like Arcade, it is doubtful whether Live Anywhere will be a selling point for the 360.

Xbox 360's marketing needs to be tackled. Microsoft must back up new software titles with broader reach marketing that hits mainstream consumers. They must seize the opportunity to target consumers who are currently sitting on the fence: the type of shopper unsure whether Wii is a gimmick and who thinks PS3's price is too high.

Lowering or dropping Xbox Live subscription fees could also help 360's chances of improving its market share and increase perceptions of value for money. Both Nintendo and Sony have suggested their online services will offer the same functionality as Live without any extra cost to consumers, so Microsoft's hand could be forced.

As Screen Play has argued before, Microsoft should also dump the Core bundle and let developers make full use of the console's hard drive. Developers currently cannot rely upon the hard disk to improve performance and loading times like they could with the original Xbox, even though 95 per cent of Australian buyers are wisely choosing the premium version.

The high-definition disc format wars might be a handicap to 360's fortunes if Blu-ray gains momentum and punters start choosing PlayStation 3 because it offers a cheap hi-def movie player (as was the case in the early days of PS2 with DVD). Blu-ray has the support of the majority of film studios, and Microsoft's add-on HD DVD drive is a clumsy solution unlikely to prove popular.

Consumers will also be unimpressed if 360 software starts arriving on multiple discs because the storage capacity of DVD is insufficient for second and third-generation HD titles. But Microsoft should also view the situation as an opportunity, and try to make the most of the 360's significant price advantage over PS3.

Overall, little has changed since Screen Play assessed Xbox 360's fortunes for its Australian launch in March: "Early adopters will have a lot of fun with 360, but there are also compelling reasons to wait: to assess the competition, for games to improve, and for console and high-definition display prices to fall."

Microsoft can't do anything about their competition or plasma and LCD prices, but it needs to crack the whip at its internal studios (or throw some cash at third-parties) to diversify the 360's software range and take full advantage of its early lead before PlayStation 3's price inevitably falls.

In 360, Microsoft has compelling hardware and the premier online service. But it is yet to prove it can match Nintendo and Sony's development teams to create a well-rounded software library with titles that appeal beyond its young male domain.

"I could do better!" has long been the rallying cry of the disgruntled gamer. But Microsoft has responded with a straightforward: "Go on then!"

Budding developers interested in getting hands-on game-making experience will soon be able to access a basic consumer version of the professional tools used to create games for the Xbox 360.

Microsoft announced this week the XNA Game Studio Express program will be available August 30 for a $US99 annual subscription.

The move is part of an industry-wide trend which sees both gamers and developers once again embracing the kinds of simple arcade-style titles the video games industry was founded upon.

In the 1970s and 80s, sole programmers could create entire games for commerical release in just a manner of months. These "bedroom coders" could develop quirky and original concepts because the financial risks were very low.

"Casual" games have always been popular on the PC, but now digital distribution services like Valve's Steam, IGN's Direct 2 Drive and Telstra's fledgling BigPond Game Shop are dramatically widening the variety of games available to consumers.

Console manufacturers are also embracing diversity, with the Xbox 360 Live Arcade service registering millions of game downloads and both Nintendo Wii and Sony PlayStation 3 offering similar online download services.

Microsoft's XNA Game Studio Express should be applauded - anything that can help young talent break into the development industry and foster new ideas is more than welcome in an increasingly risk-adverse publishing climate. Innovation is crucial for attracting new game players and keeping veterans glued to their screens.

However, despite Microsoft's hyperbole, it should be pointed out that Express is not the first time consumers have been able to produce their own console games.

Sony ran a similar scheme for the original PlayStation called Net Yaroze, and followed with a Linux PS2 kit that enthusiasts could purchase for $499.

The kits helped new talent break into the games development industry, allowing budding programmers to create working game prototypes they could show to prospective employers. Many Yaroze games also found their way onto magazine cover-discs for the public to enjoy.

Gamers will always want to play the latest big-budget blockbusters, but it is great that the games industry has started to realise we don't always have the time or the energy necessary to commit to the typical modern epic.

Developers can also widen the audience for interactive entertainment by providing short, simple and innovative little diversions.

The Nintendo DS and Sony's PSP have taken portable gaming out of the playground and into adult hands. With wireless multiplayer support and fun, innovative and fast-paced games you can enjoy wherever you go, handheld sales are booming.

Before DS and PSP, Nintendo sold an astonishing 170 million Game Boy consoles worldwide, but the average age of handheld players in Australia was just 10 years old.

Nintendo's efforts to widen the audience for handheld games have been a spectacular success. Nintendogs is a massive phenomenon, selling over six million copies and attracting many new female game players, while Brain Training has won the hearts of many older consumers with its novel reading, writing and arithmetic tests.

The release of the svelte DS Lite has proved a masterstroke, addressing the most common criticisms of the DS - the quality of its screens and the console's daggy appearance.

Nintendo has sold over 21 million DS consoles in less than two years. It took Apple 19 months just to sell one million iPods.

Sony would be disappointed with recent PSP sales compared to the DS, but their handheld debut is also bringing many new players into the market thanks to its flexible multimedia features and dazzling visuals.

According to Computer Entertainment Suppliers Association figures, Nintendo sold 4.25 million DS units in Japan during 2005, while Sony sold 2.61 million PSPs.

With PSPs selling for roughly twice the price of DS, it is certainly not all doom and gloom for Sony's handheld, particularly given Sony has shipped 17 million PSPs in significantly faster time than PSone or PS2.

In Australia, GfK figures show Nintendo has sold 287,000 DS consoles, while Sony has sold 181,000 PSPs. Sales of handhelds increased in 2005 by 206 per cent.

While some critics complain of a limited software range for PSP, there have been many high-quality releases, including Loco Roco, Grand Theft Auto: Liberty City Stories, Daxter, Lumines, Wipeout Pure, Ridge Racer, Me and My Katarami, Field Commander and Burnout Legends. Tekken: Dark Resurrection and Syphon Filter: Dark Mirror are also released in Australia in the next few weeks.

Sony's big challenge is to discourage developers from lazily dumping PS2 games onto PSP. They need to foster more innovative and original content that suits the shorter play time of a portable system and takes advantage of the PSP's strengths.

PSP's UMD movie format looks all but dead, but it was always going to be an impossible task to convince punters to buy both DVD and UMD versions of their favourite films. Of far more interest to gamers are add-ons like the upcoming GPS adaptor, which will not only accommodate satellite navigation to ensure you don't get lost, but also potentially innovative location-based games with content affected by the user's whereabouts.

In Japan, the spiritual home of video games and often the barometer of industry health and trends, handhelds now account for a 63 per cent share of the market. In 2003, TV-based consoles controlled 68 per cent, but have since shrunk to 36 per cent.

Booming handheld hardware sales are not the only incentive for Japanese developers to create new portable games. The average PS2 game in 2005 cost 139 million yen ($1.6 million) to develop compared to 62 million yen ($700,00) for PSP and just 39.8 million yen ($450,000) for DS.

Screen Play spends a lot of time grumbling, but today there's a big smile on my face.

I've spent most of the night playing one of the most highly anticipated games of the year, and so far it's every bit as good as we all hoped.

Lego Star Wars II is a big improvement on the delightful original, which sold over 4 million copies.

While aimed at youngsters, few will be able to resist the game's incredible charm. The dinky characters are packed with charisma, and the retelling of the original trilogy using the popular building blocks is both loving tribute and hilarious parody.

The game's appeal relies strongly on the Star Wars license, but as countless LucasArts titles have shown, is certainly no guarantee of an entertaining game.

Literally anyone can pick up a joypad and instantly have fun. Just three buttons are used: one to jump, another to slash a lightsaber or fire a blaster, another for special abilities like using the Force or building vehicles out of blocks.

Players never battle the dark side alone. Helpful allies fight beside you, and you can switch between characters to employ their special abilities. A second player can also join the fun at any time, with friends working together to overcome obstacles and simple puzzles.

Released on September 15 on PS2, PSP, PC, Xbox, Cube and 360, the sequel improves on the original by offering much larger levels, a lot more secrets, many more building elements, new melee attacks and dodges, plus animals to ride and vehicles like X-Wings and the Millennium Falcon to pilot.

The difficulty also now adapts according to the player's skills, although Screen Play would argue it was an unnecessary inclusion. Adult players made their own fun in the original, hunting for every secret or playing competitively rather than co-operatively with friends by fighting for studs, the game's currency.

The lure of replaying levels with different characters from the big cast and trying to find all the hidden secrets is again very strong. There's even the opportunity to mix body parts from different characters to make new heroes, like Han Vader, Stormbacca or C3-D2.

With shop shelves littered with mediocre kids games, many parents find selecting a game for their youngsters is anything but child's play. It's disappointing that so many children's games are cynically manufactured with little imagination, lazily relying on the latest movie or TV character to help sell the same tired gaming cliches. It's also very strange given that most children are actually incredibly discerning.

Fortunately, the Lego Star Wars games accommodate players of all ages and abilities by offering simple controls and almost no penalty for mistakes. They reward experimentation and encourage even grown-up kids to delight in the wonder of play.

Australian gamers praying that their favourite pastime might be covered seriously on television had their hopes crushed by the first two episodes of Channel 10's new CyberShack TV.

The program, buried after the news at 11pm on Tuesday nights, has been lambasted by gaming fans even on the official CyberShack forum.

Most of the criticism has centred on the show's lack of information during game "reviews", and the pointless and desperately dull recreations of games in "real-world" situations.

The first two shows have included host "Fuzzy" shooting paintballs to compare the experience to Tomb Raider Legend and attempting to kick a footy with the Sydney Swans for an AFL 2006 "review".

Last week's celebrity Fight Night button-bashing competition was also cringeworthy and tedious, while the Pyramat rocking chair was reviewed by the host without even being plugged in.

It was pleasing to see some coverage of May's Electronic Entertainment Expo, although Charlie Brown obviously focused on the "wackiest and zaniest" gaming gadgets he could find in order to provide some visual appeal for TV.

Worst of all, the CyberShack credits reveal that products are featured "under commercial arrangement" - which means companies are paying for some editorial coverage. That'll explain why Xbox 360 is so prevalent and there is not a hint of criticism of any product.

Obviously the show's producers are not targeting hardcore gamers, but rather attempting to widen the CyberShack "brand" to mainstream punters. However it is difficult to imagine anyone being entertained or informed by the show, given its paucity of facts and dreary content. Certainly no gaming virgins would be compelled to suddenly pick up a joypad after watching.

Keen to deflect criticism, CBN Media issued a "quick note" to media last week that the second show achieved a (whopping!) five per cent increase in viewers in capital cities compared to the program's debut.

The email then rather tersely alluded to condemnation of the program, saying "we will not be reporting any more results until such time that there is a significant issue to report." Hmmm, like the show's cancellation?

It will be interesting whether fledgling digital TV channel ABC2 can come to the rescue of disgruntled gamers with its TV program "about games, for gamers, by gamers".

"Good Game" is hosted by two passionate gamers (Mike Makowski and Jeremy Ray) and begins on September 19 at 8.30pm.

Atari's sales and marketing Vice President has taken the extraordinary step of apologising for the "half-baked" Driver 3.

As Screen Play wrote when the game was launched, Driver 3 was clearly released to the public in an unfinished state.

The game was riddled with bugs like flying cars, opponents that appeared from thin-air and characters who got stuck in scenery. The on-foot gameplay was also inept.

After recently flogging the franchise to Ubisoft, Nique Fajors used Atari's annual press event in Los Angeles to describe Driver 3 as "a half-baked product that was pushed out the door for revenue reasons."

Unfortunately, Mr Fajors did not proceed to offer disgruntled gamers a refund, which would only be fair given the exorbitant figure Ubisoft paid for the ailing franchise.

Back in July 2004, Screen Play thought it was a troubling sign for the entire industry that Atari would release such a blatantly broken game. Rushing out high profile releases riddled with flaws makes consumers extremely reticent about forking out $100 for the next so-called "blockbuster".

But Driver 3 is certainly not the only crime ever to be committed against gamers, so Screen Play would love other companies to start following Atari's lead.

Here are some suggestions for overdue apologies:

- Eidos for churning out yearly and increasingly inferior Tomb Raider games on PSone, then serving up the travesty that was Angel of Darkness (and having the hide to put all the blame on Core).

- Atari (the original American company, not the new French version) for the worst arcade conversion of all time, Pac-Man on the Atari 2600.

- Atari (again) for trying to make an ET game in 40 days, polluting the Nevada desert with six million unwanted cartridges, and almost single-handedly bringing the entire video games industry to its knees.

- Time Warner Interactive for starting the trend of graphics over gameplay with Rise of the Robots in 1994. It was one of the most hyped games ever because of its dazzling graphics, but turned out to play like a dog of Saint Bernard proportions.

- Sega for the 32X. And the MegaCD. And for so often treating Sonic fans with contempt.

- Gametek for tarnishing the legend of Elite with First Encounters, a sequel that had so many bugs that it wouldn't run on 95% of PCs.

- Titus for the atrocity that was Superman 64, a permanent fixture in any "worst game ever" list.

- Acclaim for BMX XXX. No explanation is necessary.

- Nintendo for the Virtual Boy. Did anyone ever seriously think it was going to work?

- Virgin for The 7th Guest, which almost single-handedly paved the way for full-motion video adventures and the likes of Myst. Thanks for nothing. In fact, whoever thought it would be a good idea to add any full-motion video to games should also apologise immediately.

- Every publisher in the entire industry for using ridiculously glossy high-resolution "target renders" to misrepresent their upcoming games.

- Midway for closing Adelaide-based developer Ratbag just four months after buying the studio. And they could also say sorry for every Gauntlet sequel (since Gauntlet II) while they're at it.

The battle for gaming readers and advertising dollars is intensifying as web sites and magazines gear up for a bumper Christmas with three new next-generation consoles on sale.

Rupert Murdoch's IGN Entertainment, one of the world's most popular gaming internet sites, is preparing to establish an Australian presence, and rival Gamespot is also about to re-launch an Australian gaming site.

IGN management recently visited Australia to talk to local games distributors about the new venture and recruit staff.

Both IGN and Gamespot are expected to launch Australian portals before the arrival of new gaming consoles from Nintendo and Sony in November.

The new online competition will concern local magazine publishers like Derwent Howard, who produce the official PlayStation and Xbox magazines, and Next Publishing, who produce titles like Hyper and PC PowerPlay.

Gaming magazine circulations are already falling, no doubt due to the abundance of gaming news and reviews on the internet, and IGN and Gamespot will attempt to steal both readers and advertising revenue from the magazine publishers.

TV networks are also battling for advertising dollars from game publishers, with new shows like CyberShack.

IGN was purchased by Murdoch's Fox Interactive Media division for US$650 million in September last year as part of News Corp's strategy to expand into online entertainment and media. IGN claims its web sites attract more than 31 million unique monthly users worldwide.

Screen Play wonders how much News Corp will leverage its Australian newspapers like The Herald Sun and Daily Telegraph to support IGN with advertising packages and marketing activity.

The support of News Limited papers has been instrumental in the success of men's magazine ALPHA, which launched in August last year and now enjoys a circulation of over 200,000 copies every month.

IGN's Australian presence will also present opportunities for News Limited papers to use IGN writers to improve their games coverage, which has changed little in the last decade, despite the astonishing growth in the interactive entertainment market.

The juvenile games industry desperately wants to grow up, but it needs to start tackling mature subjects if it wants interactive entertainment to be taken seriously as an important cultural and artistic medium.

As today's Livewire cover story examines, few games have tackled sex in a mature fashion. No publisher is beyond using sex to sell their products, but shameless flesh-flashing is not going to earn the industry more respect or widen its audience.

The aversion to sex seems strange considering countless controversial titles have stretched boundaries in terms of realistic depictions of violence, and the fact that most game players are now adults.

It's not just the fault of a predominately young male development community who has tended to only produce games for themselves. Increasingly conservative publishing bosses, censors and retailers have also played a major role in ensuring sex has remained taboo.

Gaming also desperately needs greater cultural acceptance in order to tackle more mature subject matter. Games are often dismissed as vacuous toys for adolescents with no artistic merit, which causes problems when developers try to tackle serious topics.

Screen Play hopes some brave developers can start exploring the possibilities of this most exciting and unique new medium.

Considering the millions of adults currently flocking to online worlds and creating mature content of their own, any pioneering developers of adult games are likely to attract many eager new players.

Many gamers are currently grumbling about being charged for pricey add-ons they believe should be included in the original purchase price of a game, but kudos to Vivendi for actually giving players something for nothing.

Available for download on August 18, FEAR Combat is the complete multiplayer component of spooky shooter FEAR, including all the updates, additional official maps and game modes all in one downloadable file.

There are 10 game modes, 19 multiplayer maps, 12 weapons and Punkbuster support to keep the cheats at bay.

Despite the excitement surrounding PlayStation 3, Xbox 360, the Nintendo Wii, and the continuing growth of the video game audience, the games industry is headed for turmoil.

The economics behind next-generation game development simply don't stack up.

Already the games industry is showing the strain, with the top two third-party game makers (Electronic Arts and Activision) posting significant net losses in their latest quarterly financial results, and many small developers and publishers struggling to survive.

Game development is an extremely risky business, with only a small percentage of games making any money at all.

In the past, hit titles were making enough cash for publishers to cover the costs of all the duds. But an increasing number of industry experts believe developing a game for next-generation consoles is almost an unwinnable bet.

With average next-gen projects costing $10 million, publishers need their game to be one of top selling titles for the year just to get their money back.

Naughty Dog founder Jason Rubin says every project in his 20-year career cost roughly five-times more to make than its predecessor. The amazing growth in the game-buying audience has kept prices reasonably stagnant for the last decade, but it is now failing to keep pace with spiraling development costs.

We're already seeing the games industry constantly regurgitating hits and relying on licenses from Hollywood and television. Only 15 of 2004's Top 100 games in the US were original titles. Only one of the Top 10 games in Australia in 2005 was original.

Unfortunately, if the risks involved in developing next-gen titles are significantly greater, the chances of publishers gambling on unproven prospects are going to be extremely slim.

The hit-driven market and rising development costs will mean a lot less games on store shelves, which unless you're a games developer facing the chop, could be viewed as a positive step considering the amount of pap that gets released today.

But it will be a big problem if innovation and creativity is further stifled. It would be a tragedy if talented developers didn't have the freedom to create new and exciting games because the risks were too great.

The industry will somehow find answers. Millions of people around the world want to play interactive games, and we'll need talented developers to create them.

But there will be a lot of casualties. Currently companies like Midway and Atari are in financial peril, and the Australian games development community is bracing for its biggest challenge yet: survival.

Screen Play suspects solutions will include more in-game advertising, government and private investment funding for developers, more pay-for-play online systems and digital distribution. We've also already seen price hikes for next-generation games and (perhaps as a direct consequence) the rise in popularity of cheap downloadable titles.

The incredible mainstream success of the Grand Theft Auto games in the face of widespread outrage and criticism is fascinating.

GTA publisher Take 2 has faced legal action from countless groups, with some cases still pending, while conservative politicians around the world have frequently labeled the games socially irresponsible.

Meanwhile, the series has enjoyed global sales of over 40 million units in five years. In Australia, Grand Theft Auto: San Andreas was the highest selling game of the past two years, and Liberty City Stories has been PSP's biggest seller.

The phenomenon looks set to continue, with developers Rockstar currently working on two new GTA games - Vice City Stories for PSP and the highly anticipated GTA IV for PlayStation 3 and Xbox 360.

Games unanimously condemned for their excessive violence or sexual content are usually flops. The public knows when a game is using shock tactics as a gimmick, and keeps their wallets shut.

Without any media attention the likes of Manhunt, Postal, Carmageddon and BMX XXX could have sunk into obscurity even quicker. Grand Theft Auto, Doom and perhaps Mortal Kombat are the few games that have been embraced by mainstream punters while simultaneously condemned by the world's politicians, parents and tabloid columnists.

The success of Grand Theft Auto III, Vice City, San Andreas and Liberty City Stories must be in spite of their violence, not because of it. Their appeal is unparalleled and intoxicating freedom: you can choose how you wish to play.

You can enjoy the game simply playing as a daredevil stuntman, taxi driver, paramedic, firefighter, or simply cruising the streets jiving to the fabulous soundtracks. Other players enjoy the storylines, revel in the countless diverse challenges or like creating mayhem and trying to escape from the law.

Violence is undoubtedly encouraged in the GTA games, but like a Tarantino film, the brutality is made palatable by humour. The stylised, unrealistic visuals also help the player stay removed from the actions of their on-screen avatar. It's gloriously anarchic escapism.

Humourless and more graphically realistic GTA competitors like The Getaway, The Godfather and True Crime have been far less popular and successful than the fun-loving GTA series.

It will be interesting to see whether THQ's gansta game Saints Row, released at the end of the month on Xbox 360, can win admirers with its particularly devious tone.

Rockstar also faces the huge challenge of harnessing next-generation graphics for GTA IV without making the game unpalatably realistic and courting even more controversy.

Rubin said the idea for Crash originated on a road trip. After moderate success with "a Mortal Kombat rip-off" for the fledging 3DO console, Rubin and business partner Andy Gavin drove 5000km across the US to set up their new development studio at the Universal Studios backlot in Los Angeles.

"We started that car ride and didn't know what game we were making, and somewhere in Iowa we decided we wanted to make a character action game."

The ambitious pair realised that unlike Nintendo and Sega, Sony didn't have a character mascot to promote the new PlayStation console.

"This was arrogant thinking that two guys were going to jump into that league," Rubin says.

The pair rightly believed that 3-D graphics were the future, but thought a free-roaming game would not be possible on the PlayStation hardware.

"So we decided to take Mario or Sonic, turn it 90 degrees into the screen, and players would follow the character in 3-D. We called it Sonic's Ass game - you were mainly going to be looking at the character's ass."

Rubin and Gavin then started thinking about the vital ingredients for an iconic anthropomorphic character.

"What we realised was that the Tasmanian Devil and the Road Runner are great because everyone's familiar with the word Road Runner but no-one knows what one looks like.

"We realised that Australia had a lot of these creatures, so we got a book on Tasmanian marsupials.

"One of those was a wombat - wow, that's a great word. Willy the Wombat was the original name of Crash Bandicoot.

"We just went through this book, and there was the echidna - that was Sonic the Hedgehog - then the Tasmanian Devil...and we thought: 'Wow, obviously anything from this book will work!'"

Naughty Dog went on to sell 25 million Crash Bandicoot games for the PlayStation console before moving onto the acclaimed Jak and Daxter series for PS2.

But despite the bandicoot making him very rich, Rubin says the gaming industry no longer needs icons like Crash, Mario and Sonic as much as it once did.

"The industry has icons but I think the whole icon thing was predicated on the fact that we were selling to kids.

"As a kid it's very hard to get excited about a piece of hardware as you do as an adult.

"Kids get excited by characters, faces, by happy fun McDonalds. When Nintendo was selling toys, they used Mario to stand in for the game, which works very effectively with children.

"As we get older and as we're selling to a broader audience, the guys that are buying the Xbox to play Halo, they don't need to see a funny character. The icons of the old days aren't necessary anymore."

Rubin, one of the industry's most articulate entrepreneurs, left Naughty Dog in 2004 after finishing work on Jak 3. Rubin and Gavin have now established a new studio, Morgan Rose, and are working on a game called Iron and the Maiden.

Crash Bandicoot's next game is Crash Boom Bang! - a mini-game compilation for the Nintendo DS in the style of Mario Party and PSone's Crash Bash. It will be released by Vivendi before Christmas.

Do you think it is important that the games industry tackles mature subjects?

I want to clarify my definition of mature content... it's "shut-up and think". You don't shut-up and think when you watch the Texas Chainsaw Massacre or Showgirls, but you do when you watch Crash.

Death-Boobs IV is not more mature than Loco Roco, it's just for an older audience.

So yeah, I think it is important that the industry tackles more mature content because currently it's like TV only showing Macgyver, Vegas and The A-team 2020. No Six Feet Under, no Sopranos, no Deadwood.

I like my gore-physics as much as the next guy, but you can't just live on ice cream, right?

Why do you think the games industry has displayed such an immature attitude to sex in the past?

Most people whip out the "it's run by little boys who never talk to women." This ain't true, because they're not in charge...

The first problem is the industry is so young, uncertain and formless that it generally makes the easy call; the choice between the next Halo, or the next Sims is no choice at all. A Halo rip-off is understandable, marketable and easy to make exciting trailers for. Sims was and is a risk.

Second, truly mature thought-provoking content always comes from experimental creatives, but the game industry is currently run by committees of Publishing VPs and Walmart purchasing managers.

How can developers tackle sexual content in a more mature fashion?

Well currently they can't, because most developers can't afford to pursue any creative vision a publisher might shy away from. I can walk into a developer tomorrow with a game that's enthralling to play, non-exploitative and makes people really think about personal relationships, and with the whole budget in my briefcase... and every developer would have to say no, even if they loved it, because their publishers are convinced there is no market for it.

And they're right, there is no market for new content until that market is created by a content-provider willing to dip their toe and maybe lose some money.

Some of these confused folk are so eager to be the next Hollywood that they don't realize they're just the old, scared Hollywood from 40 years ago.

Why do you think Australia's censors are stricter on sexual content than they are on violence?

That's an anglo thing. If a kid sees someone get eviscerated, no harm done. But if he sees someone's map of Tassie, who knows what will happen! Sex is teh dirty (sic).

Personally I'd prefer my children to know about how people interact in the bedroom than how a bowie knife interacts with a liver.

Do you think the infamous Hot Coffee scenes from Grand Theft Auto San Andreas would have been given the all clear from the OFLC if they were submitted for an MA15+ rating?

No. For the same reason Federal cops still raid comic shops - because dumb people believe that games and comics are only for kids right? They shouldn't be to adult-oriented, period.

But frankly those scenes are a waste of developer and player time. The things that make the GTA series great are not that crap, it's the sand-box world, the settings and some good driving physics, not sub-par erotica. Whoever made that call needs to quit and become a porn director if that's what blows his hair back.

Is there any sexual content in a game that has surprised or offended you?

Constantly - because it doesn't add to the gameplay and it doesn't compete with purpose-made erotica or porn. The breast physics in Dead or Alive does not make the fighting better. The increasing skimpiness of Lara's outfits doesn't add to the gameplay.

I'd actually be less offended by full-on, adults only, "you must be this tall to purchase" porn games than this current schoolboy, boob-jiggle crap. But hey, that's what happens when you let marketers and retailers run an entire industry.

Do you think online worlds should be policed to avoid sexual harassment?

As much as the real world should be, which is probably a bit more than it is now. But who would you get? The only person I'd trust not to be a secret misogynist or a knee-jerk PC reactionary is me, and I'm busy. Maybe that's what we can use the first generation of real AIs for.

With the emergent sexual content found in most massively multiplayer online worlds, do you think developers will start to release online games with specifically erotic themes?

Ahhh yes, MMO's are the only major game area that doesn't need a traditional publisher model. So that's where we'll see the first truly mature content. And it will be revelatory. FPSs that deal with the real consequences of violence, RTSs that have real-world political issues, Sims style games that explore the intricacies of all possible sexual relationships. Sign me up.

Australia's classification regime has been slammed in a report on the future of the interactive games industry released today.

The PricewaterhouseCoopers Entertainment & Media Outlook: 2006 - 2010 report calls on the Federal Government to introduce an R18+ classification for games.

"The introduction of an R18+ classification would be to the public's benefit, rather than a social evil, because it would provide more information to consumers," the report says.

"It's time the Australian classification regime for interactive games was brought into line with those of other countries and other forms of entertainment, such as films and literature."

PricewaterhouseCoopers says Australia's current ratings regime has resulted in "inconsistent rulings" over the past year by the Office of Film and Literature Classification, with the recent banning of Marc Ecko's Getting Up: Contents Under Pressure showing "the classification regime at its worst."

In February, the OFLC's Classification Review Board voted three to two to refuse classification because it promoted crime and graffiti.

"At the same time, numerous other games which reward gamers for virtual graffiti have been classified and are generally available," according to PricewaterhouseCoopers. "They include Grand Theft Auto: San Andreas, the high-selling game of the past two years. In that game, players steal cars and commit other random acts of violence."

Need for Speed: Most Wanted also gives gamers "the thrill of illicit street racing" and was released in November 2005 with a G rating.

"Films and TV programs frequently feature criminals as sympathetic protagonists without similar hysteria that it will convert viewers to lives of crime."

The PricewaterhouseCoopers report says the lack of gradation in ratings provides less, rather than more, information to Australians making purchasing decisions. It also "increases the chances that inappropriate content will find its way into the hands of younger gamers."

PricewaterhouseCoopers expect Australians to spend over $1.2 billion on interactive games and consoles in 2006, predicting software sales will rise by 20 per cent, and console hardware (including handheld) sales to rise by 47 per cent.

In 1980, long before Game Boy and in a "golden age" where kids played hopscotch and marbles instead of Pokemon, a Japanese playing card manufacturer called Nintendo released some electronic toys onto an unsuspecting market.

The little LCD screens featured very simple games, but they were great fun and highly portable, ensuring "Game & Watch" was an instant hit.

The first silver and gold Game and Watch units like Ball, Flagman, Fire and Helmet were quickly followed up in 1981 with Wide Screen releases like Parachute, Octopus, Popeye, Mickey Mouse and Snoopy Tennis.

The prices, way above their original cost, naturally beg the question: can some video games or systems actually become an investment?

Del Reiss, owner of pinball specialists Bumper Action Amusements, has been selling arcade games since 1972. He believes original coin-operated machines are reliable and make excellent investments.

"These games were only produced once, so as time goes on, their average condition diminishes," Del says. Quality games like Defender are going to be worth a lot in the future."

For example, Space Invaders coin-operated machines could be picked up for as little as $500 a few years ago, but today sell for around $1200. Mr Reiss expects their value to "double or triple in the next five years".

Pinball machines are also gaining interest from collectors wishing to profit from their favourite hobbies. Anyone who bought a Kiss pinball in the last decade has seen their investment rise dramatically.

But can games ever be a good investment when they are based on such fragile technology? Game media like cartridges, disks and cassettes have a notoriously limited lifespan.

Some collectors believe games should be preserved in as-new condition and locked in airtight containers to keep forever. But it is the experience of playing a game that should be preserved and appreciated. Being able to play the game itself is more important than admiring a box.

Screen Play hopes most of the increasing demand for Game & Watch units that is fuelling high prices shows the passion many gamers have for Nintendo's heritage rather than any cynical attempt to profit from a retro gaming fad.

Microsoft's Xbox Live Arcade online service has been a remarkable success, and soon PC and mobile phone users will be able to share the fun.

The Xbox 360 service offers classic arcade games as well as new "casual gaming" titles from both major publishers and independent studios.

Millions of downloads have been recorded since the 360's debut less than a year ago and Microsoft has been "overwhelmed" with submissions from developers wanting to bring new games to Live Arcade.

In part two of Screen Play's interview with David Hufford, Director of Xbox Product Management for Microsoft, we explore the future of Live Arcade.

Many developers are claiming the cost of developing games for next-generation consoles is too high and that publishers are too conservative and risk-adverse. How is Microsoft trying to address the situation?

Xbox Live Arcade is a perfect example of how we are supporting the independent developers of the world today. We have more than 100 developers producing games for Xbox Live Arcade, many who will be names you have never heard of.

We're giving a voice to the guys that are creating games in the garage, and that's exciting.

Over time we're going to be rolling out a series of announcements that will further drive this wave of independent ideas that you'll start to see in the market so that everyone with a great game idea can have their game published.

If a start-up has a great idea for a Live Arcade game, where do they go next? How can they get their game published?

If you've got a great idea and you want it published on Xbox Live Arcade you can actually just call us and get your idea financed.

There are currently 300 developers who are either producing Xbox Live Arcade games or who have submitted ideas to us.

Frankly, we're overwhelmed by the submissions, but we're ramping up quickly to look carefully at all the submissions and see which games make sense to bring to Live Arcade. What you're seeing here is a hotbed of game creativity taking shape.

We're leading the way and our competitors have announced that they'll be following our lead in digitally distributed games. That puts a smile on our face.

What share of the cost of an Arcade game goes back to the developer?

We don't release that information, we work with developers independently and don't share that kind of information on our business models.

But the advantage to a developer is to get their content distributed. Retailers can’t stock all these games that people have in their minds. This really gets their ideas out of their minds and onto the box and into the hands of people who play games without worrying whether you're going to get shelf space at retail.

With the forthcoming Live Anywhere service allowing Arcade titles to be played on computers and heldhelds as well as Xbox 360, how do you ensure that someone has the same experience on whatever platform they choose to play on? Obviously PCs have millions of different configurations...

The idea is that you buy the game once and you can play it on any device. It's our job to make sure that as we scale Xbox Live from 360 over to the Windows platform and then to the mobile platform that you have a great experience regardless of the device you're playing it on.

So we're spending a lot of time now to make sure that as we move games across these platforms you're still getting a great experience.

As titles get older, will they be pulled from Arcade or will you add more categories for organisation?

They won't get pulled. What happens with Xbox Live Arcade is that once you buy the game, you own it forever. Even if you decide you don't want to be an Xbox Live user, you still own that title and get to play it on your box.

We look forward to having the problem of needing more organisation. If we can get to a point where we have 500 titles we'll be giving consumers incredible choice in what they play, and they can go back in time and look at some of the great classics.

Geometry Wars five years from now will be crowned a classic, it's been a huge runaway success for us. And we're going to see a flood of people picking up Pac-Man, Galaga, Dig Dug, Sonic the Hedgehog, Mortal Kombat - there's always going to be a place for classic games.

But as we bring more digital content to Xbox Live Arcade and the Marketplace, you're going to see us keep up with the enormous amount of content with better ways to navigate through the user interface so you can get whatever information you want much faster.

When the amount of content available increases, how will you market individual titles to tell gamers about them?

At the moment you log onto Xbox Live you see banners for hot new content. But the user interface is going to get much more intuitive than it is today as the library expands.

It's our job to make sure you hear about these new titles. Independent developers and publishers will also be promoting their titles and we're going to make it easier for people to find the games and content that they want as they're navigating through Xbox Live.